Strong customer/supplier relationships: A key to enterprise growth in Japan

Based on econometric analysis of data drawn from a large business database and on interviews with eight HGSMEs, this chapter examines the interactions between firms’ business relationships (with both suppliers and customers) and growth performance (in terms of sales) in Japan. The authors found that three dimensions in transaction relationships have a positive effect on enterprise growth: the number of relationships relationships with large or fast-growing firms and geographic proximity to suppliers and customers. Both, the results from the econometric analysis and the findings derived from the case studies were consistent.